In October, Cain had to undo damage from the following: a suggestion to put up an electrified fence on the Mexican border, statements endorsing a woman’s right to choose, an apparent unfamiliarity with the terms “right of return” and “neoconservative,” a tentative thumbs-up to negotiating with Al Qaeda for prisoners and news stories of a completely mismanaged campaign.

Now allegations of sexual harassment have drowned out pretty much anything else related to Herman Cain. And if that’s in any way a blessing, it’s only because it diverted attention from what may have been some serious violations of campaign-finance laws.

Herman Cain gets away with stuff like this — stuff like being inconsiderate or egomaniacal, or just stuff like saying absolutely the wrong thing. An ordinary candidate wouldn’t recover from saying that he wouldn’t appoint Muslims to his cabinet…

Most of [Cain's] former staff members…speak of a man so egotistical that careful self-policing would never really enter into the realm of consideration.

They also speak — bitterly — of a candidate with zero interest in policy… They speak of unrelenting self-absorption, even by the standards of a politician.

Herman Cain’s 9-9-9 Plan: $210k Tax Cut for Richest 1%, $2k Tax Hike for Bottom Three-Fifths of Taxpayers — Citizens for Tax Justice

Cain’s proposed tax plan would replace all existing federal taxes with three new taxes: a flat nine percent individual income tax, a flat nine percent “business tax,” and a nine percent national sales tax.

Moreover, under the 9-9-9 plan, the United States government would collect about $340 billion less in revenue in 2011 alone.

Herman Cain: Nein, Nein, Nein! — Justin Raimondo

[Cain wrote] that the “war on terrorism” is a conflict that “will be fought forever.”

Cain promotes the views of Pastor Rod Parsley, an evangelical nut-job who not only teaches Islam is an “anti-Christ religion” based on “deception,” and that the prophet Mohammed was a “demon spirit,” but also claims “America was founded in part, with the intention of seeing this false religion destroyed.”

[Cain believes] that “World War III” has already started…: “In WW III, our enemy is the irreconcilable terrorist wing of a religion — Islam — and a handful of nations that harbor terrorists and fund their activities. Those nations include Iran, Syria, Venezuela and North Korea.”

I’m sure Hugo Chavez will be very surprised to learn he’s been lording it over a Muslim country rather than a staunchly Catholic one — and I can only imagine the look on Kim Jong Il’s face when he he hears the muezzin’s call to prayer ring out over the streets of Pyongyang.

The Flat-Tax Fraud — Robert Reich

[The] non-partisan Tax Policy Center estimates that Cain’s plan (the only one out there so far) would lower the after-tax incomes of poor households (incomes below $30,000) by 16 to 20 percent, while increasing the incomes of wealthier households (incomes above $200,000) by 5 to 22 percent, on average.

Under Cain’s plan, fully 95 percent of households with more than $1 million in income would get an average tax cut of $487,300. And capital gains (a major source of income for the very rich) would be tax free.

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Back when I played Monopoly, I remember games when I was the last remaining opponent and I would land on “Boardwalk,” where there was a hotel. But the rent was more then I had, and the game would be over. I was broke and had lost the game.

The American attitude to life seems to be that so many want to win as they would in Monopoly, and they won’t be satisfied until they have aggregated all the money in the game — that is, until everyone else is broke.

We have organized the greatest concentration of wealth since we organized our country. We have also created the greatest concentration of worldwide media power during the same time frame.  

Is there something wrong in America when only 400 Americans have more wealth then the “poorest” 150 million Americans? Would the broadcast news organizations of the ’50s, ’60s and ’70s have pressured their managements to “expose” this to the American public?

CBS broadcast “Hunger In America”. Would they have broadcast “Poverty In America”?

In my opinion, there’s something wrong when the four most powerful media companies control so much and report on so little.

The “Monopoly players” in life must change the rules of the games so that anyone foolish enough to land on “Boardwalk” is not destroyed and all of the players in the game are allowed to live a decent life.

I am not advocating a socialist environment. I’m merely asking our country not to promote the notion of the “have’s” having yet more than they already have.

The gigantic electronic deliverers of “the message” might conceivably inform their follow Americans of our problems — were they not a major part of the problem. Necessary societal changes appear futile when the apparatus for promoting change is in the hands of those media giants who only want to expand their control and profitability.

Monopoly is just a game; having an expectation of a decent life is not.

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According to the latest polls, most of you believe that anti-white racism – or “reverse racism,” as many of you refer to it – is now a bigger problem than anti-black racism. That, apparently, is the majority view in White America.

The view looks very different, however, in Black America.

In Black America, the unemployment rate is 16.8 percent, twice the unemployment rate in White America. 35 percent of black households have zero or negative net wealth, compared with 15 percent of white households — and the gap is growing. The average white household is 20 times richer than the average black household — the largest gap since the government started recording this data a quarter century ago.  

The recent recession widened these gaps. In the twentieth century, most blacks had trouble getting mortgages. Banks discriminated against poor black neighborhoods. During the housing bubble, this discrimination took the opposite form: predatory lending. The void left by mainstream lenders was filled by pawn shops, payday lenders, and check cashing services that charged high fees and usurious interest rates. Blacks were far more likely to receive subprime loans and then to experience foreclosure. Even if a black household had the same creditworthiness, default risk, employment, income, and demographics as a white household, the black household usually received much riskier, more expensive loans.

But it’s not just the recession. The unemployment gap has existed as long as blacks have been free to find jobs, even among blacks and whites with the same education level. Employers are far more likely to call back job applicants with white-sounding names. They are significantly more likely to hire white job applicants with a criminal record than black job applicants without a criminal record.

In Black America, infants are twice as likely to die as in White America. That gap has also grown over the last three decades. Even if blacks had the same background characteristics as whites — maternal age, educational attainment, etc. — two-thirds of that gap would still exist. If Black America were its own country, it would rank 67th in infant mortality, just below Qatar and Uruguay.

In Black America, 4 percent of the male population is in jail, compared with 0.7 percent of men in White America. Blacks comprise 40 percent of prisoners in America, though they comprise only 13 percent of the general population.

And it’s not because they’re more likely to commit a crime. According to recent research, blacks are significantly more likely to be arrested than whites for the exact same crime. On average, a black criminal who murders a white victim will receive a significantly harsher punishment than if the murder had been committed by a white criminal, regardless of the characteristics of the victim or the quality of legal counsel.

White drug users outnumber black drug users four-to-one. According to one study, “White students use cocaine at seven times the rate of black students, use crack cocaine at eight times the rate of black students, and use heroin at seven times the rate of black students.” Another study reported that “white youth aged 12-17 are more than a third more likely to have sold illegal drugs than African American youth.” Yet blacks are three times more likely to be arrested on drug charges.

As a result, blacks are unfairly disenfranchised more than whites. In the recent case Farrakhan v. Locke, the Ninth Circuit Court of Appeals openly admitted that “the statistical disparity and disproportionality evident in Washington’s criminal justice system arise from and result in discrimination,” yet they did not uphold the Constitution’s prohibition of racial discrimination in voting.

No wonder Congress won’t take their calls. Literally. Just like employers, legislators are less likely to respond to requests from blacks than from whites.

And they need to be heard. In a country where 13 percent of the population is black, only 10 percent of the House of Representatives is black, and there are zero black Senators.

In Black America, equal representation, the cornerstone of democracy, does not exist.

So while I understand your distaste for affirmative action and other diversity programs that seem like “reverse racism,” I urge you to remember that whites receive affirmative action too — only, we call it by a different name: everyday life in America.

Your fellow White American,
Anthony W. Orlando

==========

This op-ed was published in today’s Hazleton Standard-Speaker.

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Until now.

First, let’s see what I’m responding to:

A high corporate tax rate moves jobs overseas. Currently American companies are sitting on more than $2 trillion of cash overseas, which is used for hiring and investments in foreign operations.

The United States has the second highest corporate tax rate in the world. Two things we must do to spur job growth and expand the taxpayer base in the America: Cut the corporate tax rate from 35 percent to 20 percent, the median tax rate for the developed countries, and eliminate the taxes on repatriation of foreign earnings.

Wow. Every sentence there is either wrong or very misleading.  

Prof. Mishra is talking about “statutory” tax rates, but corporations hardly ever pay statutory rates. They use all sorts of deductions and exemptions and loopholes to pay a lot less than “the second highest corporate tax rate in the world.” When you measure what they actually pay — a.k.a. “effective” tax rates — you find that the United States has low corporate taxes, compared to the rest of the world:

According to Prof. Mishra, this “high corporate tax rate moves jobs overseas.” But, as tax journalist David Cay Johnston reports, “that is not General Electric’s experience”:

GE’s disclosures show that over the last decade it paid much lower tax rates in America than offshore, just the opposite of the Washington political mantra. Even more puzzling, the U.S. corporate giant chooses to take more of its profits in other lands despite the higher tax rates there.

Prof. Mishra never explains how high taxes move jobs overseas or why it’s a bad thing that “American companies are sitting on more than $2 trillion of cash overseas.” (I’m glad I’m not in his class.) My best guess is that he’s trying to say the following: If those companies bring that cash back to the U.S., they will use it for “hiring and investments” here.

Only one problem: American companies already have lots of cash, and they’re not using it for “hiring and investment.”

In late 2008, they started receiving more cash than they were investing:

As a result, American companies are no longer borrowing cash. They have so much excess that they’re lending it:

They don’t need more cash. If American companies do bring that $2 trillion back to our shores, they won’t use it “for hiring and investment.” They’ll buy back stock, pay bigger dividends, park it in Treasuries and other financial securities — nothing that will “spur job growth and expand the taxpayer base.”

It’s just another Trojan horse. Make corporate owners pay less taxes, and you’ll only enrich corporate owners. It won’t trickle down to the rest of us.

That’s what happened in 2004, when Congress temporarily allowed companies to repatriate foreign-earned income at a discounted rate of 3.7 percent. Usually, they have to pay the full rate, but they can “defer” that payment as long as they want. That’s why they’re “sitting on more than $2 trillion of cash overseas.” If they “repatriated” it to America, they’d have to pay more taxes. They’re hoping Congress will grant them another “holiday” like in 2004:

A study of the impacts of the tax break by Dhammika Dharmapala, C. Fritz Foley, and Kristin J. Forbes found, however, that “[r]ather than being associated with increased expenditures on domestic investment or employment, repatriations were associated with significantly higher levels of payouts to shareholders, mainly taking the form of share repurchases. Estimates imply that a $1 increase in repatriations was associated with an increase in payouts to shareholders of between $0.60 and $0.92, depending on the specification.” The authors suggest that companies were able to make these distributions to shareholders without violating the terms of the repatriation legislation by using the repatriated funds “to pay for investment, hiring, or R&D that was already planned, thereby releasing [domestic] cash that had previously been allocated for these purposes to be used for payouts to shareholders.”

And what little hiring they did do was quickly reversed:

• Hewlett-Packard…”announced a repatriation of $14.5 billion, layoffs of 14,500 workers, and stock buybacks of more than $4 billion for the first half of 2005 – about three times the size of its buybacks in the period a year earlier.”
• Pfizer, which repatriated around $37 billion (the largest amount of any firm) shortly before eliminating around 10,000 American jobs and closing U.S. factories in 2005;
• Ford Motor Company, which repatriated around $850 million under the holiday and then laid off more than 30,000 U.S. workers in 2005 and 2006;
• Merck, which repatriated $15.9 billion and announced layoffs of 7,000 workers in 2005;
• Honeywell International, which repatriated $2.7 billion and laid off 2,000 workers in 2005 and 2006.

According to the Congressional Research Service, “most of the largest beneficiaries of the holiday actually cut jobs in 2005-06.” Congress lowered their taxes, and it didn’t help the economy one iota.

But that’s nothing new. As Robert McIntyre, Director of the nonprofit Citizens for Tax Justice, recently told Congress:

Over the years, my group has done numerous studies on corporate tax subsidies and their effect on corporate investment behavior and job creation. In all of these studies, we found no positive correlation between the amount of subsidies that companies received and their investment and jobs performance.

Wait. It gets worse.

In order to “expand the taxpayer base” and reduce the budget deficit, Prof. Mishra says we should “eliminate the taxes on repatriation of foreign earnings.” So riddle me this: How does eliminating taxes help us reduce the budget deficit?

Think about that until your head explodes.

Therein lies the most profound problem with Prof. Mishra’s argument: It all depends on the assumption that lowering tax rates will increase economic output so much that it increases tax revenue.

Historically, that’s completely false. The effective corporate tax rate has been falling for over fifty years:

Yet corporate tax revenue (as a percent of GDP) has been plummeting at the same time:

Enough for one day. I’ll talk more about tax rates-versus-revenue tomorrow.

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I’m trying to imagine the moment when that itsy bitsy company AT&T decided, “Hey, we’re only grossing $124 billion. We only have 300,000 employees. Our assets are only worth $268 billion. Why don’t we go out and ‘eat’ another company? Why not T-Mobile? They only have 34 million customers. Their gross income is a paltry $21 billion.”

Have you seen the TV commercials advertising how great it’ll be if these two companies operate as one rather than — God forbid — competing with one another? This will be good for America, they always say, just like the previous “consolidations” that allowed CBS to be gobbled up by Viacom, ABC to be consumed by the Walt Disney Company, NBC by Comcast, and of course Fox by News Corp. They are, like Antonia in Man of La Mancha, only thinking of us.

Actually, those mergers were not good for America. Our purported “regulators” sided, as they almost always do, with “the regulated,” and everyone won…except the public.  

Here’s one of the best dissenting arguments I’ve read:

AT&T argues that its merger with T-Mobile will have a profound effect upon its ability to provide broader and better mobile broadband coverage at lower costs to US customers. According to AT&T, these benefits will be based on the greater scale and scope of the merged entity and hence the higher network efficiencies and lower costs per customer it will be able to realize.

But AT&T argues simultaneously that the merger will not have any effect upon the intensity of competition in the US mobile market, invoking the alleged strengths of competitors who are today much smaller than itself (or even not yet in operation such as LightSquared). So perhaps these other operators are much more capable and efficient than AT&T in being able to achieve competitive outputs despite their far smaller scale and scope, although AT&T claims it has been doing all it can and exhausting all available alternatives to increase the performance of its services to its customers. Or perhaps scale and scope are not all that important over a very broad range in affecting a mobile operator’s competitor’s effectiveness, in which case it becomes hard to understand why an already large AT&T should find substantial — even critical — added value in becoming even larger.

In effect, AT&T is arguing that it can have its cake, and others can eat it too. But if you accept AT&T’s arguments about the benefits of scale and scope, then you have to agree that a duopoly is bound to emerge if the transaction with T-Mobile is approved, i.e. AT&T’s implication that competition will ensure that a duopoly is not the inevitable outcome of the merger is not credible.

Acceptance of AT&T’s position that its merger with T-Mobile USA will (a) Bring enormous benefits to the US economy and mobile customers thanks to its increased scale and scope but (b) Not however lead to any significant reduction in competition is logically inconsistent, insane and outrageous – like playing Tina Turner’s song “What’s Love Got to Do With It” at a wedding. The conclusion that this transaction is unjustified and unjustifiable holds whether you believe AT&T’s mutually incompatible sets of claims about the merger (large merger-specific benefits and insignificant reduction in competition) or recognize that in reality both of them are equally unfounded. Unless of course you ignore all shreds of reason and evidence like many in today’s US Congress.

When I was working for Columbia Pictures, CBS, Polygram, and MGM, “getting bigger” invariably allowed us to be more abusive in the marketplace. As an operating person, I’m sure I’m not alone on this.

It would be refreshing if AT&T said what they were really thinking: “We love this idea because many of us will become very rich when the deal goes through and screw the public anyway.”

Instead, they claim that their “merger with T-Mobile will have a profound effect on [their] ability to provide broader and better mobile broadband coverage at lower costs to US customers.”

Sure it will!

I’m only thinking of him,
I’m only thinking of him,
Whatever I may do or say;
I’m only thinking of him!
In my body, it’s well-known,
There is not one selfish bone…
I’m only thinking and worrying about him!

– Antonia (Man of La Mancha)

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